Same old IBM? Not exactly
IBM kicked off 2026 looking a lot more like a disciplined software-and-infrastructure machine than the sleepy legacy giant people love to joke about. Revenue climbed 6% in Q1, free cash flow grew 13%, and the company kept pointing to the same favorite buzzwords: hybrid cloud, AI, and mission-critical enterprise workloads.
The good stuff was where it should be
Software revenue rose 8%, powered by double-digit growth in data and Red Hat. Infrastructure was even spicier, up 12%, with IBM Z having a monster quarter and jumping 48%. That matters because IBM’s story is basically: if you’re running the stuff companies can’t afford to break, they’ll keep paying you.
AI, but make it enterprise-y
Arvind Krishna spent plenty of time on the AI pitch, and this wasn’t the “we have a chatbot too!” variety. IBM’s angle is more like: let the big models do their thing, but keep the sensitive and expensive workloads running on infrastructure clients actually trust. In other words, IBM wants to be the plumbing, the security guard, and the control room all at once.
The outlook stays stubbornly upbeat
IBM said it still expects more than 5% revenue growth for the full year and sees free cash flow rising by $1 billion. It also flagged macro noise in Europe and the Middle East, but management sounded pretty comfortable that its client mix and geographic diversity can absorb the bumps.
Big picture
IBM is still not the sexiest stock on the block. But if you like steady cash flow, enterprise AI exposure, and a company that can turn “old-school mainframe” into “AI platform” without blinking, this quarter gave you more reasons to pay attention.